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Trading Jesse Livermore Quotes

Discussion in 'Shares' started by Tropo, 30th Jul, 2011.

  1. Tropo

    Tropo Well-Known Member

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    All through time, people have basically acted and reacted the same way in the market as a result of: greed, fear, ignorance, and hope. That is why the numerical (technical) formations and patterns recur on a constant basis.

    The game of speculation is the most uniformly fascinating game in the world. But it is not a game for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer. They will die poor.

    Don’t take action with a trade until the market, itself, confirms your opinion. Being a little late in a trade is insurance that your opinion is correct. In other words, don’t be an impatient trader.
    It is foolhardy to make a second trade, if your first trade shows you a loss. Never average losses. Let this thought be written indelibly upon your mind.

    Remember this: When you are doing nothing, those speculators who feel they must trade day in and day out, are laying the foundation for your next venture. You will reap benefits from their mistakes.

    When a margin call reaches you, close your account. Never meet a margin call.
    You are on the wrong side of a market. Why send good money after bad? Keep that good money for another day.
    Successful traders always follow the line of least resistance. Follow the trend. The trend is your friend.

    A prudent speculator never argues with the tape. Markets are never wrong opinions often are.

    I absolutely believe that price movement patterns are being repeated. They are recurring patterns that appear over and over, with slight variations. This is because markets are driven by humans and human nature never changes.

    When you make a trade, you should have a clear target where to sell if the market moves against you. And you must obey your rules! Never sustain a loss of more than 10% of your capital. Losses are twice as expensive to make up. I always established a stop before making a trade.

    In a narrow market, when prices are not getting anywhere to speak of but move in a narrow range, there is no sense in trying to anticipate what next big movement is going to be – up or down.

    Instead of hoping he must fear and instead of fearing he must hope. He must fear that his loss may develop into a much bigger loss, and hope that his profit may become a big profit.

    A man may beat a stock or group at a certain time, but no man living can beat the stock market.

    A man must know himself thoroughly if he is going to make a good job out of trading in the speculative markets.

    I learned that the weaknesses to which a speculator is prone are almost numberless.

    Among the hazards of speculation the happening of the unexpected – I might even say of the unexpectable – ranks high.

    Observation, experience, memory and mathematics – these are what the successful trader must depend on.

    There is nothing new in Wall Street.
    There can’t be because speculation is as old as the hills. Whatever happens in the stock market today has happened before and will happen again.
    Of course there is always a reason for fluctuations, but what the tape does not concern itself with the why and wherefore. It doesn’t go into explanations.
    The reason for what a certain stock does today may not be known for two or three days, or weeks, or months. But what the dickens does that matter? Your business with the tape is now – not tomorrow.
    The reason can wait. But you must act instantly or be left.

    There is a time for all things, but I didn’t know it.
    And that is precisely what beats so many men on Wall Street who are very far from being in the main sucker class.
    There is the plain fool, who does the wrong thing at all times everywhere, but there is the Wall Street fool, who thinks he must trade all the time.
    No man can always have adequate reasons for buying and selling stocks daily – or sufficient knowledge to make his play an intelligent play.

    The desire for constant action irrespective of underlying conditions is responsible for many losses on Wall Street even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.
     
  2. wdongli

    wdongli Well-Known Member

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    Jesse Livermore was one of greatest speculators in last century. He did make great successes but unfortunately he could not make a happy ending. he won and lost due to the speculation!

    ***
    1. Enemies to destroy the asset and capital:
    greed, fear, ignorance, and hope.

    2. Numerical (technical) formations and patterns recur on a constant basis.
    but what is the causes and how to be sure the pattern you expect will be next?

    3. The game of speculation is the most uniformly fascinating game in the world.
    A game not for the stupid, the mentally lazy, the person of inferior emotional balance, or the get-rich-quick adventurer, is very true.

    What if you are stupid, mentally lazy, have inferior emotional balance, or hunger for quick and easy money? It is about behavior and how could you change your behavior which has been formed in decades?

    ***
    Livermore is a legend with some gift. He was so successful but failed tragically. He seemed could not be wise always especially when the luck joked with him.

    He seemed stand on the mountain to speculate the winds and storm with the belief that he could identify the patterns with sound logic belief that is human nature could not be changed. But sometimes human reacts to the similar things could be different. He didn't have the intention and training to come down from where he stayed and check the health of the roots of the thing he wanted.

    He still could not see something. He still could not interpret the chart perfect as fact. When the days came against him, he had no way to escape. He had not some plan B for disastrous consequences. He at last was destroyed by the enemies he knew quite well. He was a warrior and could speculate very well in most of time but he still could not do better than the bankers in the main street.

    He could be a prudent speculator but he was blinded by the limitation of the speculation. Things grows need their days and not all of things could grow into a money tree.

    ***
    "Observation, experience, memory and mathematics – these are what the successful trader must depend on."

    If we don't have these, could we trained us to get better and get some pennies in the market? There are a lot of employees who thought their bosses are stupid. But most of employees keep to work for the stupid bosses. It is about how to get all of internal and external resources for a one big goal roughly right? We tend to be absolutely right in details but absolutely wrong to get any significant goal in life.

    It is great if we could speculate greatly. But few has this kind of gift. Traders star at Wall Street everyday. They know "There is nothing new in Wall Street" but they don't know "there is nothing new in Main Street too." The men in main street could get the people to trade with the affordable capital for high return. Few traders could get more to use main street for their future goals.

    Livermore knew too much about Wall Street but he never got enough knowledge about main street and he failed in all of his investment. Wall Street needs the gift to speculation. Main Street needs risk calculation for the desired return even they run some speculation business. Of course sometimes all of the society become the home to speculate, which includes the main street too. If you have the gift to speculate, try to put your profit into a place where the money could grow by itself.

    We have too many things to master. In the market we could have more chances to fail than success. When you are young you could fall down and get up to start again easily since you are a white paper. When we are old, we have too much mental barriers to break.

    ***
    Have to say most of us don't know how to speculate and invest. I am an example. We don't have plan to make butters and milks from the market in business way, and we also don't have the shrewd minds to speculate. We are poor gamblers, who always feel perplexed why we could not figure out when to hold'em and unfold'em.

    We could not dare to commit suicide after the shirt losing. We could not be wise enough to do the business. We hate the load to do so after we left the office and workshop so tire everyday. We just want to trade for quick money! We have the wrong experiences for market and we don't have passion to get that for market. We have some math but we could not know where to use.

    In this war place, most of us would be gone with regret since we could not tell what patters would be next. We feel pity to the people who stay in the corners. We don't accept the fact we could not speculate very well. We could not force us to build our business from the ground.

    We want not to be greedy, fearful, panic, and despondent, over-optimism, or euphoric but we never try to change our behaviors and don't know where to start.

    ***
    Behavior is the result of what we get in the past. Could we mix the wisdom in Wall Street and Man Street? You are in the market you could not ignore it. You want to be safe in the market so you could not arrogant to speculate in all of the time. You have to get the cautions main street has.

    The first bucket of gold is always hard to get. Wrong place? You get nothing. Wrong time? You get nothing too. Why couldn't you leave your office behind after a decade in the market? We are inferior to use something. We are much worse than we believe. We could not be excellent in the office and workshop so that we expect we could be lucky in the market!

    We need to see us honestly and then we might have chances to change! Patters have misled us for so long and made so many have lost the shirt. Livermore committed suicide. Something wrong intrinsically in the patters. Why few people could watch the cloud patterns in the sky to tell if we could harvest in the autumn? If we want harvest, We have to do our job. There are more things than the patters to decide harvest or calamity ahead!

    ***
    Depressing is very powerful to destroy us. Why did Livermore commit suicide? He was despair to make another magic again at the age of 60s. Why Warren Buffett could stir the market and let a lot of people to blame and joked him down? Livermore won in the tactics for winds and failed in the few vital strategic matters. Buffetts won in details and extremely prudence and business senses. George Soros has the roots in economies fundamental, the comprehensive theories to deal with the trend with great prudence and necessary business plan to support.

    Don't mistaken me. I do appreciate Livermore very much. If I could I would like to do the same without matter what the consequences are. The problems are we are not him or them. We have to find our own ways to get our goals, little or big. How? We have to be alerted by overoptimism! It is very powerful and fatal. We have to know the value. We have to know the market sentiment. We have to know what is our bottom line in the market. We have to set up a mechanism to change our behaviors.

    In the market it is not a problem if we are not stupid. The problem is how we could be less stupid! How could we turn the mistakes as the new start for reviving. Inverting is necessary. We need new angle to see Livermore for the lessons which would make us do the business in the market roughly right always! I hate to do the absolutely wrong things in the market!
     
    Last edited by a moderator: 30th Jul, 2011
  3. wdongli

    wdongli Well-Known Member

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    Thinking about plan and process to plan

    Each of us has some gift used in wrong time

    Good ideas and gift could make magic in the market. Some traders, who are not complicated in mind but valiant, could make killings and look very wise and intelligent if the market conditions match his personal traits in time.

    It is hard or impossible one could make killings always. It is understandable since you follow the trend but trend just change after your betting, you would be broken. However life is always easier for the people who win out and market doesn't mind what make you get the killings.

    It is my believe each of us has some gifts but we could waste our gifts for wrong reasons at wrong time for wrong position in the market. We have to know ourselves and environment and then we could feel the gifts and find the time to use them.

    Each gift has its own catches

    If we are always lucky, we don't need to think about plan. If we are not lucky or we want to be lucky always, we have to prepare to avoid the unlucky matters and times in the market. That is about how to get the protection mechanism before we look for chances. We have to think the road map or plan to make you looks lucky but you do know your winning for long term is never so simple and lucky!

    Some could get the senses about reality quickly and instinctively. But most of us don't have this gift but some one else. We could be very tough and could try very hard to find the light in the dark tunnel.

    Everything has its catches and the challenge to us is how we could use our gifts at the right time and right conditions without the damage from their catches! I would never be 50 anymore. I could not allow myself to be caught by the catches!

    What're the catches of your gift?

    We need to know our catches from our gifts. It is very important if we never use the gifts at the right time for right position before. We need sort out what gift we have. Don't think you have some gifts? Why could you be in Australia? Why could you write or read in this lovely website? We do need some honest and would like to see ourselves objectively.

    Who am I? I am a doer and tougher naturally. They are gifts time by time in my life turning points. I could put me into one thing passionately. If I am right to get the direction and know the valley of death, I could work hard to go forward for my way.

    However these gifts have their catch in the market. Market is a war place. If I am wrong at beginning, I could be wrong for quite long time. I tend to ignore the environment change but hold my false belief in the wrong time for wrong position. I have to struggle to get out from the messes in despair time by time in the market. It is ignorant and arrogant hopelessly!

    In the last 2 decades, I could throw the money into property market and hold. I took it very seriously since I knew then if I was wrong I would be defeated with the leverage to put me into the hell. I read all to be sure I was right at the very beginning and used my gifts to hold it.

    I liked the quick money but I didn't know the market was a war place. By lucky I was right for IT booming but I didn't know or didn't want to know the trend could be changed in days. I didn't understand the catches of my gift. I got huge paper profit but become stubborn to fight against the trend change. Never realized my stubborn until all of paper profit gone.

    All of my failure come from big winning in the market. The mistakes since April 2011 scared me very much since I have tried to avoid the catches.

    How to avoid the catches from your gifts?

    We tend to oversimplify our emotion and exaggerate our capability to control our emotion. You could not control your emotion if the conditions are there. These conditions are made by our behaviors to the changed environment.

    We have to know what can do and what cannot do at the different conditions. We need the rules, principles, guideline for us to use our gifts at the right conditions and never come to the place the catches would hit us down! We need the goals and procedure to check the conditions.

    We need plan A to use our gifts. We need plan B to get out if the catches start to play their parts. We need to enrich our gifts which could be got in experiences and trainings! Business is to use our gifts and get new gifts in organization for defined goals. We need to setup our own business in the market.

    To me I could not figure out any other ways by which I could use my gifts and avoid the catches from my gifts and enrich my gifts.

    How to get a viable business plan

    Business needs management for organization such as process for adding value, the unique product and services, marketing your services, accurate operations, and sales when customers cheerful to pay for your service or product.

    We need to walk though the various segments of our dreamed business and we need to explain
    our goals, rationalities of operations to the goals. We do so just as we map out a game plan before we put us into it. We ponder how to put our best foot forward and what are the nuts and bolts of the plan:

    1. management, operations, and marketing analysis
    2. budget and fiscal policies for bottom line objectives
    3. necessary backup of business as a whole

    We may could not get a perfect business plan in days but it would guide us to set up the road to change our behavior for a long term revival! Could we go long enough and use our gifts for our happy ending with the plan? It depends on if we could change at the time we should change for the gifts the market needs.

    Business plan is a process for a road map to be unique, practical, and viable:

    • Preparing your ideas for your plan
    • Setting goals for your plan
    • Using your plan for operations
    • Putting your plan into action

    It is a process to make our behavior for specific, manageable, achievable, realistic, and in the target time frame. If we could use this process in all of our business action in the market, we would be organized, disciplined, analytical, and self-reliant. We would have a mechanism to use our gifts and avoid the catches, and get new gifts without the harm of the new catches.

    We could be the people to use Main Street way to deal with Wall Street. We could predict that we would not commit suicide since we know we only could do market and our gift allow!

    We should learn to:

    • know what, when, and where of ourselves
    • expand on what, when, and where into past and future for lessons and benchmark
    • include why and how to get what, when, and where

    If we could follow these basic process for the actions on all of vital few matters and operation details, we would get the personal behavior for our market business and then the business behavior to service the warriors best!
     
    Last edited by a moderator: 31st Jul, 2011
  4. Tropo

    Tropo Well-Known Member

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    He seemed stand on the mountain to speculate the winds and storm with the belief that he could identify the pattern.

    He was one of the best in tape reading ( I assume that you know what I am talking about).

    He still could not see something. He still could not interpret the chart perfect.
    When the days come against him, he has no way to escape.
    He at last was destroyed by the enemies he knew quite well.
    He was a warrior and could speculate very well in most of time but he still could not do better than the bankers in the main street.

    That is what most taxi drivers think!!

    You as hopless is this business need lusck...
    Do you speak Chinese, French, German, English ??

    Why could you leave your office behind after a decade in the market?
    Don't you think it is time for you to go back to your office ?

    We are inferior at something.
    ?????????????? (is it Chinese saying ?).

    We are much worse than we believe who we are. We could not be excellent in the office and workshop so that we expect we could be lucky in the market!
    Are you talking about yourself ??

    Patters have misled us for so long and made so many have lost the shirt.
    I am sorry to hear that this happened to you...

    Something wrong intrinsically in the patters.
    Is it a Chinese dish ?

    Why few people could watch the cloud patterns in the sky to tell if we could harvest in the autumn?
    And you must be one of them....(am I correct ??).

    We have to say there are more than the patters to decide who is winner or loser!
    So how many "patters" you must consume or deal with, to tell who is who ???

    We don't have the idea about the black swan.
    But we know that sacred cows exist.

    We don't think we need the protection!
    Hey.....what about "Bollé" ???

    Why do we sell on fire?
    Because some people (like you), do not wear "Bollé".

    We need the shrewd speculation about the market sentiment.
    How do you define this?

    We need business sense to get the return for sure.
    Can you tell me more about it ??

    We need to stop when it is too much and check where we could be sure they never disappear in the place we hold them.
    Who or what are you talking about? :confused::confused:
     
  5. wdongli

    wdongli Well-Known Member

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    Gold loaded dice but what your responses are?

    Business is a organized process for its vision and mission. It is the way to be organized, disciplined, analytical, and self-reliant. It could be used for anything desired things and make them have high probability to be true. A lot of confusions ahead.

    Sure I need to get my English better but it shouldn't be my priority. English improvement should be a by product while I focus to change my behavior in the market! I like the words from Joseph Ford:

    ‘God plays dice with the universe. But they’re loaded dice. And the main objective is to find out by what rules they were loaded and how we can use them for our own ends.’

    If you find problems but don't put time and efforts for solution, you could not find the rules which tell us what God has loaded into the market and then you could not work for your ends and benefit. Why do we waste our time to find problems always?

    US could be default but what if it doesn't? Could you get the positions to benefit from it? If not why do you bother and feel so painful to cry?
     
    Last edited by a moderator: 1st Aug, 2011